Update your knowledge on the newest FinTech’s payment systems in the world, especially in Indonesia. Here is the information you need to know.
Nowadays, there are many types of FinTech companies all over the world. Technology has changed the way things work, including in the financial field called Financial Technology or FinTech. In Indonesia alone, the industry has expanded to various types of financial services including on payment services. Then, how does it work and will the bank help or oppose it?
The development of FinTech-based payment services in the
world
FinTech payments in the world are increasingly sophisticated, especially for the international payment sector. How come? International remittances have been considered one of the greatest opportunities for FinTech startup companies that handle payments.
Indeed, for a very long time, the banking industry has been charging very high fees to consumers for very simple things like peer-to-peer money transfers and international remittances. With FinTech all can be done in seconds and even free of charge!
Blockchain technology proves to be very useful for those who need to send or receive funds abroad.
For example, FinTech startup companies such as Paycase that allows consumers to send money quickly and cheaply overseas. Another example is Bitcoin which is still a controversy in Indonesia. Bitcoin allows people to invest and trade with it.
Another opportunity is the newest alternative payment system—called omnichannels—that began to be applied in Europe in January 2018. This payment system will require financial institutions to give other companies access to their payment systems through some software interfaces. This means you can make payments from your bank account via messages on your phone. Great, is not it?
What about FinTech's financial services in Indonesia? How has it evolved?
The rapidity of the e-commerce industry has also led to leveraging technology between consumers and e-commerce companies in online payments. Some online payment system providers in Indonesia include Veritrans, Doku, and Mimopay which support online payment methods in several marketplaces and work with several SMEs (Small and Medium Enterprises) to promote their products.
There is also Mobile Payment, the payment method using mobile phones or smartphones. So far we know the most used mobile payment system is one of the banking products known as Mobile Banking. One of the FinTech companies in Indonesia that implement the Mobile Payment system is Dimo that offers an online payment system by using a code QR (Quick Response). Dimo’s competitors who run the same business model are Sakuku by BCA and Ipaymu.
The role of the bank in FinTech's payment system
Although the so-called FinTech can pose a threat to the conventional banking industry, there can be a positive and even profitable collaboration between the two. The FinTech companies come with good market solutions and user-friendly applications, while banks have a greater number of loyal customers and are experts in risk management. Both parties can complement each other to improve payment options for businesses and consumers.
Bank DBS Indonesia for example, through the “digibank” application, provides virtual assistant services in Indonesia. With this application, customers can easily create new accounts without having to come to the branch offices. Also, customers can interact at any time with assistant robots for their daily transaction needs. Since August 2017, there have been 15,000 customers installed this application. DBS targets to have 3.5 million new customers with digibank in the next five years.
Relefance: Fintech Organizers
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